Canada’s Liberal Government, Most Provinces Endorse Climate Pact

By Paul Vieira

OTTAWA—Canada’s Liberal government and the bulk of the country’s provinces reached an agreement late Friday on measures to fight climate change, even as Prime Minister Justin Trudeau tries to revive the energy sector with the recent approval of two pipeline projects.

The climate pact envisages the implementation of a federal carbon-pricing plan unveiled in October and plans to phase out coal-power electricity. This approach emerges as President-elect Donald Trump signals Washington is moving to lessen environmental regulation in a bid to drum up more investment in U.S. resource development.

“The need to act now is not simply a moral imperative but an economic necessity,” Mr. Trudeau said at a press conference, flanked by provincial and territorial leaders. “With this framework, we are telling Canadians and the world that a cleaner environment and a strong economy go hand in hand.”

Earlier Friday, U.S. Vice President Joe Biden, in Ottawa as part of a two-day visit to the Canadian capital, urged Canadian leaders to pursue carbon-reduction efforts because corporate America and the rest of the world are on that very path, despite the policies of the incoming administration.

“Whatever uncertainty exists around the near-term policy choices of the next president, I am absolutely confident the United States will continue making progress in its path to a low-carbon future,” Mr. Biden told Mr. Trudeau and provincial premiers.

Mr. Trudeau has positioned the fight against climate change as one of his government’s signature issues, with the Liberal government aiming to reduce carbon output by 30% below 2005 levels before 2030. Agreement among Ottawa and most provincial capitals fulfills a promise from Mr. Trudeau to build a national consensus on tackling climate change, and represents a pivot from the previous Conservative administration, which tended to focus on championing resource development.

Not all Canadian provinces, though, are onboard. Brad Wall, the premier of Saskatchewan, said he couldn’t endorse the pan-Canadian climate-change plan because it calls for a carbon tax when the province’s energy, mining and agriculture sectors are struggling.

Under the federal plan, Canada would start pricing carbon pollution at 10 Canadian dollars ($7.58) a metric ton in 2018, and that would rise steadily to C$50 a ton in 2022. All provinces will be required to have a carbon-pricing regime in place by 2018 that is stringent enough to meet the 2030 federal target of a 30% emissions reduction from 2005 levels, or Ottawa will impose its levy.

“Now is not the time for a tax that disproportionately impacts the industries that create jobs in our province,” said Mr. Wall, as Mr. Trudeau watched on. The unemployment rate in Saskatchewan stood at 6.8% in November, well above the 3.5% level from two years ago.

Manitoba also didn’t sign on to the accord, and its premier, Brian Pallister, said the decision was tied to Ottawa’s failure to substantially boost health-care funding.

Officials said the deal struck between Ottawa and the regions covers 93% of the country’s population.

Canada’s efforts to curb carbon emissions through a price on carbon and other regulations “will unequivocally be negative for overall economic growth, and proportionally more” in commodity-heavy regions such as Alberta and Saskatchewan, said Michael Gregory, economist at BMO Capital Markets.

The pact also envisages policies that compel retrofits on buildings to promote energy conservation; more money to encourage electric-car use; and methane reduction in the energy patch, according to a communiqué the Prime Minister’s Office released.

Mr. Trudeau’s push on climate change comes at a tenuous time for the economy, which is slowly digging itself out of an estimated C$90 billion hole, according to the Bank of Canada, triggered by the swoon in commodity prices and lost manufacturing capacity.

In that vein, Mr. Trudeau last week granted approval to two pipeline projects, among them an expansion of Kinder Morgan’s Trans Mountain pipeline. Kinder Morgan’s project would nearly triple capacity on an existing corridor, to 890,000 barrels of crude oil a day, connecting Alberta’s energy patch to tankers at a terminal in suburban Vancouver, British Columbia. Mr. Trudeau also approved Enbridge Inc.’s proposed Line 3 project, which aims to replace segments of an existing pipeline connecting Hardisty, Alberta, to Wisconsin.

Environmentalists said pipeline approval wasn’t consistent with Mr. Trudeau’s carbon-reduction target, as it would encourage further development of the oil sands. Canada’s energy sector is the country’s largest emitter of carbon, accounting for over a quarter of annual greenhouse gas output.

Mr. Trudeau, though, said Canada needed to tap new markets for its vast reserves of energy, and the transition to a low-carbon economy wouldn’t unfold overnight. Further, he said he wouldn’t have approved the Kinder Morgan project were it not for carbon-reduction measures introduced by resource-rich Alberta. The province, the nerve center of the country’s energy sector, has signed on to Canada’s carbon-pricing plan.

Environmental organizations on Friday offered initial support to Ottawa’s deal with the majority of provinces.

“This is a big deal,” said Dale Marshall, national manager for Environmental Defence. He added the agreement could put Canada “on the path to phasing out fossil fuels over time and replacing them with clean, renewable energy.”

GRAND RAPIDS, Mich.—President-elect Donald Trump is pushing for Ronna Romney McDaniel, the Michigan Republican party chairman, to head the Republican National Committee, according to a person familiar with the decision.

The choice of Ms. McDaniel, the niece of 2012 Republican presidential nominee Mitt Romney, would install a political insider as the head of the party to succeed Reince Priebus, who is joining the administration as Mr. Trump’s chief of staff.

Ms. McDaniel helped introduce Mr. Trump on Friday in Grand Rapids, Mich., where the president-elect made the fourth stop on his postelection victory tour. She didn’t mention the RNC but noted that Mr. Trump was the first Republican to win the state in nearly 30 years.

Mr. Trump thanked Ms. Daniel for her help during the campaign, saying, “She didn’t sleep for about six months.”

The president usually picks the chairman of the national party, which is why there is no election to lead the RNC, whereas several candidates are jockeying to lead the Democratic National Committee ahead of a late-February election. Mr. Trump’s selection is expected to be unanimously approved by the 168-member RNC executive committee, which includes three top party leaders from each state, Washington, D.C. and five U.S. territories.

“I’m certain that the next RNC chair is going to be the person designated by Donald Trump,” said Morton Blackwell, the longtime national committeeman from Virginia. “But, like many things over the past year and a half related to Mr. Trump, who he will designate is not predictable.”

While there is no public campaigning for the job, there is activity behind the scenes. Known and potential contenders include Ms. McDaniel; Republican strategist Nick Ayers, a top adviser to Vice President-elect Mike Pence; David Bossie, a senior campaign adviser to Mr. Trump and the national committeeman from Maryland; and Republican operative and Fox News contributor Mercedes Schlapp.

Mr. Priebus has told RNC members that he would prefer that the next chairman come from the committee, in a gesture to the Republican rank-and-file activists who elected those members. That sentiment—shared by many RNC members—could put Mr. Ayers and Mrs. Schlapp, who aren’t committee members, at a disadvantage.

But Mr. Trump, a one-time Democrat and independent who ran a fiercely antiestablishment campaign, doesn’t have longstanding ties to the party leadership. Many past chairmen tapped by Republican presidents came from outside the RNC.

Henry Barbour, the national committeeman from Mississippi, said the next RNC chairman faces the challenge of nurturing those Trump voters who aren’t strongly tied to the GOP, as well as making inroads among groups that widely rejected him, including Hispanics and African-Americans.

Mr. Barbour helped lead a sweeping RNC review after the 2012 election that urged Republicans to embrace “comprehensive immigration reform” to appeal to more minorities. Mr. Trump, however, vowed to deport undocumented immigrants and build a wall along the southern border, building a political base of predominantly white, working-class voters.

“We have a lot of work to do,” Mr. Barbour said. “It’s not a given that we are going to win going forward. It’s important that we capitalize on Mr. Trump’s connection with working folks in this country who feel like they’ve been left on the side of the road, but it’s just as important that he show that he’s working for all Americans so the party can grow with nonwhites.”

The RNC is scheduled to gather in Washington, D.C., three days before Mr. Trump’s inauguration in January to formally elect its new leadership team.

Cisco Wins Another Patent Ruling Against Arista

By Don Clark

Cisco Systems Inc. has persuaded an International Trade Commission judge that Arista Networks Inc. infringed two Cisco patents, the latest development in a high-profile legal tussle between the two Silicon Valley rivals.

Arista, which denies infringing the patents, said ITC Administrative Law Judge Mary Joan McNamara on Friday found no infringement of four other patents Cisco originally asserted in the case. Arista said it would ask the full commission to review the judge’s infringement ruling concerning the two patents, which if granted would likely result in a final determination in April.

The commission could decide to order a ban on imports of Arista hardware, as it did in a parallel patent case earlier this year.

Arista, as in the earlier case, said it would modify its products in ways that would exclude technology found to infringe the Cisco patents.

Cisco and Arista also have been squaring off in a copyright infringement trial in federal court in San Jose, Calif., which is expected to produce a jury verdict next week.

Cisco is the biggest maker of switching systems used to connect servers inside data centers and to the internet. But Arista, whose chairman and chief executive are former Cisco executives, has grabbed a substantial chunk of the market since its founding in 2004.

Cisco first accused Arista of copyright and patent infringement in December 2014.

The ITC infringement ruling involves patents that cover technologies associated with controlling and improving operations of switching or routing systems. Arista, which contends the switching chips it purchases are responsible for any infringement, is separately trying to convince the Patent and Trademark Office to declare the patents invalid.

Following the ITC patent infringement ruling earlier this year, Arista recently convinced U.S. Customs and Border Protection officials that modified versions of its products aren’t covered by the import ban. Cisco is asking the ITC for an additional ruling to block the Arista imports.

Cisco Wins Another Patent Ruling Against Arista

By Don Clark

Cisco Systems Inc. has persuaded an International Trade Commission judge that Arista Networks Inc. infringed two Cisco patents, the latest development in a high-profile legal tussle between the two Silicon Valley rivals.

Arista, which denies infringing the patents, said ITC Administrative Law Judge Mary Joan McNamara on Friday found no infringement of four other patents Cisco originally asserted in the case. Arista said it would ask the full commission to review the judge’s infringement ruling concerning the two patents, which if granted would likely result in a final determination in April.

The commission could decide to order a ban on imports of Arista hardware, as it did in a parallel patent case earlier this year.

Arista, as in the earlier case, said it would modify its products in ways that would exclude technology found to infringe the Cisco patents.

Cisco and Arista also have been squaring off in a copyright infringement trial in federal court in San Jose, Calif., which is expected to produce a jury verdict next week.

Cisco is the biggest maker of switching systems used to connect servers inside data centers and to the internet. But Arista, whose chairman and chief executive are former Cisco executives, has grabbed a substantial chunk of the market since its founding in 2004.

Cisco first accused Arista of copyright and patent infringement in December 2014.

The ITC infringement ruling involves patents that cover technologies associated with controlling and improving operations of switching or routing systems. Arista, which contends the switching chips it purchases are responsible for any infringement, is separately trying to convince the Patent and Trademark Office to declare the patents invalid.

Following the ITC patent infringement ruling earlier this year, Arista recently convinced U.S. Customs and Border Protection officials that modified versions of its products aren’t covered by the import ban. Cisco is asking the ITC for an additional ruling to block the Arista imports.

Let’s Be Honest: Are You an Investor or a Speculator?

With the stock market seemingly setting all-time highs every day, even as bond prices crumple, this is a crucial time to clarify the difference between investing and speculating.

Unfortunately, that distinction—often credited to the great investment analyst Benjamin Graham—has never been entirely clear.

Every asset is an investment in some people’s hands and a speculation in others’. So it isn’t what you buy, but rather why you buy, that determines whether you are investing or speculating.

In his classic 1934 book “Security Analysis” and again in “The Intelligent Investor” (1949), Graham wrote: “An investment operation is one which, upon thorough analysis, promises safety of principal and a satisfactory [or ‘adequate’] return. Operations not meeting these requirements are speculative.”

I used to regard that description as definitive, but I began to see its flaws a few years ago. Can any analysis ever be thorough enough to “promise” safety or a positive return?

The traditional view, dating back at least to the 19th century, is that an investor buys to capture a predictable long-term stream of cash flow, while a speculator buys to harvest a short-term change in price.

But if you purchase 100 acres of raw land and hold it undeveloped for a half-century because you expect the area to turn into a suburb, are you an investor?

The property produces no rent or other income. And you can profit only if, decades from now, someone pays you a higher price after inflation. What sounds like an investment is largely a speculation.

If you bought Amazon.com when it first sold shares to the public in 1997 at $1.50 (adjusted for stock splits) and have held it ever since, are you a speculator? The stock has shot up past $765 a share, with staggering swings up and down along the way; the company doesn’t pay a dividend and often hasn’t even reported a profit.

But you bought Amazon because you reasoned it would transform the world of retailing, and you hold it—even though the stock trades at more than 175 times its earnings—because you think the company isn’t done with that transformation yet. Your original speculation has grown to resemble an investment.

Someone else buying Amazon for a quick turn in the stock price—say, a rise from $1.50 to $2 almost 20 years ago, or from $750 to $766 this year—is a speculator. Same asset, same time, different motivations and horizons.

It isn’t just that the same asset can simultaneously be an investment and a speculation depending on who holds it and why. The same person can be an investor and a speculator at the same time.

Surveying 210 clients who each traded at least 120 times a year, discount brokerage Fidelity Investments found that they restricted their short-term trading to 37% of their total assets on average.

“When you talk to them in person,” says Drew Brownsword, senior vice president, “they’ll say, ‘I’m not an active trader, I’m an investor who trades.’”

Barry Metzger, a senior vice president for trading services at Charles Schwab Corp., says some active traders “wear that as a badge of honor” and “believe that trading is fun and a part of who they are.” Other investors who trade a small portion of their portfolios regard that activity as only “a means to an end.”

Benjamin Graham advised strictly segregating your speculations from your investments. The best idea: Set up a “mad money” account where you can take a flyer, if you must. Limit it to, say, 5% of your total and never add more.

“There’s an element of the speculator in everybody,” says Rob Arnott, chairman of Research Affiliates, a firm in Newport Beach, Calif., whose strategies are used to manage about $165 billion.

So it is important, before committing any money to any asset, to ask yourself why you want to. “Picture a continuum running from speculator at the far left to investor at the far right,” Mr. Arnott says. “If you buy this asset, where are you on that continuum?”

Why does it matter?

If you think you are investing, when in fact you are speculating, a collision with reality could knock you off-course.

Dennis Butler, who runs Centre Street Cambridge Corp., an investment adviser in Cambridge, Mass., offers this example: If, with stocks at record highs, you buy an index fund because you think that is a safe way to earn annual returns of at least 10% a year, then you are speculating. If, on the other hand, you buy an index fund knowing that “stock prices are high and future returns will be lower as a result,” he says, then you are investing.

I would add: If you buy because you are afraid of being left behind should stocks keep booming, you are speculating.

If the market’s rise makes you worry instead and look to rebalance your portfolio by selling some of what has gone up and buying some of what has gone down, you are investing.

Let’s Be Honest: Are You an Investor or a Speculator?

With the stock market seemingly setting all-time highs every day, even as bond prices crumple, this is a crucial time to clarify the difference between investing and speculating.

Unfortunately, that distinction—often credited to the great investment analyst Benjamin Graham—has never been entirely clear.

Every asset is an investment in some people’s hands and a speculation in others’. So it isn’t what you buy, but rather why you buy, that determines whether you are investing or speculating.

In his classic 1934 book “Security Analysis” and again in “The Intelligent Investor” (1949), Graham wrote: “An investment operation is one which, upon thorough analysis, promises safety of principal and a satisfactory [or ‘adequate’] return. Operations not meeting these requirements are speculative.”

I used to regard that description as definitive, but I began to see its flaws a few years ago. Can any analysis ever be thorough enough to “promise” safety or a positive return?

The traditional view, dating back at least to the 19th century, is that an investor buys to capture a predictable long-term stream of cash flow, while a speculator buys to harvest a short-term change in price.

But if you purchase 100 acres of raw land and hold it undeveloped for a half-century because you expect the area to turn into a suburb, are you an investor?

The property produces no rent or other income. And you can profit only if, decades from now, someone pays you a higher price after inflation. What sounds like an investment is largely a speculation.

If you bought Amazon.com when it first sold shares to the public in 1997 at $1.50 (adjusted for stock splits) and have held it ever since, are you a speculator? The stock has shot up past $765 a share, with staggering swings up and down along the way; the company doesn’t pay a dividend and often hasn’t even reported a profit.

But you bought Amazon because you reasoned it would transform the world of retailing, and you hold it—even though the stock trades at more than 175 times its earnings—because you think the company isn’t done with that transformation yet. Your original speculation has grown to resemble an investment.

Someone else buying Amazon for a quick turn in the stock price—say, a rise from $1.50 to $2 almost 20 years ago, or from $750 to $766 this year—is a speculator. Same asset, same time, different motivations and horizons.

It isn’t just that the same asset can simultaneously be an investment and a speculation depending on who holds it and why. The same person can be an investor and a speculator at the same time.

Surveying 210 clients who each traded at least 120 times a year, discount brokerage Fidelity Investments found that they restricted their short-term trading to 37% of their total assets on average.

“When you talk to them in person,” says Drew Brownsword, senior vice president, “they’ll say, ‘I’m not an active trader, I’m an investor who trades.’”

Barry Metzger, a senior vice president for trading services at Charles Schwab Corp., says some active traders “wear that as a badge of honor” and “believe that trading is fun and a part of who they are.” Other investors who trade a small portion of their portfolios regard that activity as only “a means to an end.”

Benjamin Graham advised strictly segregating your speculations from your investments. The best idea: Set up a “mad money” account where you can take a flyer, if you must. Limit it to, say, 5% of your total and never add more.

“There’s an element of the speculator in everybody,” says Rob Arnott, chairman of Research Affiliates, a firm in Newport Beach, Calif., whose strategies are used to manage about $165 billion.

So it is important, before committing any money to any asset, to ask yourself why you want to. “Picture a continuum running from speculator at the far left to investor at the far right,” Mr. Arnott says. “If you buy this asset, where are you on that continuum?”

Why does it matter?

If you think you are investing, when in fact you are speculating, a collision with reality could knock you off-course.

Dennis Butler, who runs Centre Street Cambridge Corp., an investment adviser in Cambridge, Mass., offers this example: If, with stocks at record highs, you buy an index fund because you think that is a safe way to earn annual returns of at least 10% a year, then you are speculating. If, on the other hand, you buy an index fund knowing that “stock prices are high and future returns will be lower as a result,” he says, then you are investing.

I would add: If you buy because you are afraid of being left behind should stocks keep booming, you are speculating.

If the market’s rise makes you worry instead and look to rebalance your portfolio by selling some of what has gone up and buying some of what has gone down, you are investing.

GRAND RAPIDS, Mich.—President-elect Donald Trump is pushing for Ronna Romney McDaniel, the Michigan Republican party chairman, to head the Republican National Committee, according to a person familiar with the decision.

The choice of Ms. McDaniel, the niece of 2012 Republican presidential nominee Mitt Romney, would install a political insider as the head of the party to succeed Reince Priebus, who is joining the administration as Mr. Trump’s chief of staff.

Ms. McDaniel helped introduce Mr. Trump on Friday in Grand Rapids, Mich., where the president-elect made the fourth stop on his post-election victory tour. She didn’t mention the RNC but noted that Mr. Trump was the first Republican to win the state in nearly 30 years.

See Markets React to the Fed in 7 Charts

Stocks wobbled only slightly in the wake of the news that Fed officials only need “some further evidence” of economic progress before raising rates, hinting that a December hike is firmly on the table. About 20 minutes after the widely expected announcement at 2 p.m. Eastern, the benchmark S&P 500 was less than 3 points lower than it was just before the news hit the wire.

Elsewhere, Treasury yields, the dollar and gold barely budged. Far from the sort of “tantrums” that have occurred in the markets after some past Fed announcements, the reaction to the November statement shows that it told investors what they already knew: The central bank seems very likely to raise rates next month.

Here’s a look at the snap reaction across some of the major asset classes. The charts are live and will present an updated picture if reloaded.

See Markets React to the Fed in 7 Charts

Stocks wobbled only slightly in the wake of the news that Fed officials only need “some further evidence” of economic progress before raising rates, hinting that a December hike is firmly on the table. About 20 minutes after the widely expected announcement at 2 p.m. Eastern, the benchmark S&P 500 was less than 3 points lower than it was just before the news hit the wire.

Elsewhere, Treasury yields, the dollar and gold barely budged. Far from the sort of “tantrums” that have occurred in the markets after some past Fed announcements, the reaction to the November statement shows that it told investors what they already knew: The central bank seems very likely to raise rates next month.

Here’s a look at the snap reaction across some of the major asset classes. The charts are live and will present an updated picture if reloaded.

Startup Investing for the Little Guy

By Jeff Brown

In the old days, an investor hoping to get in on the ground floor of the next Google or Facebook had a couple of options: have a friend or relative on the inside, or sign on with a big brokerage firm handling the startup company’s private placement—a sale of stock that hasn’t yet gone public.

Not anymore. Ordinary investors now can buy shares in startups that are just getting off the ground, sometimes for just a few dollars. If, that is, they are willing to take on a whole lot of risk.

It all started with the Jumpstart Our Business Startups Act in 2012. Since the act’s Title III took effect in May 2016, people no longer have to be well-to-do “accredited investors” to buy into startups.

But along with hopes of 100-fold gains come big downsides. Many of these startups fly beneath the radar of big venture investors who vet fledgling firms. Often, they aren’t promising enough to go public the traditional way, and they lack a track record, proven product and thorough financial disclosures. And since their shares aren’t publicly traded, it may be impossible to cash out until an exit event like an IPO or buyout, and the firm may tank while you wait.

“Quite honestly, it’s as close to gambling as you can get. You are dealing with a level below penny stocks,” says Keith Hamilton, owner of Hamilton & Associates, a registered investment-advisory and wealth-management firm in La Jolla, Calif. When clients want to invest in startups of any kind, he says, “I tell them to call it their gambling account.”

This new method of buying into startups is the latest and hottest development in the broader field of crowdsourcing.

Money-lending sites like publicly traded LendingClub Corp. make loans from a pool of investor money and pass payments back to investors. Charitable sites like GoFundMe.com allow people to give to causes that may be too small for ordinary foundations, like helping an individual accident victim with living costs. Rewards portals such as Kickstarter and Indiegogo allow donors to contribute to specific projects such as an independent film, and offer perks like a prerelease showing.

Equity crowdfunding—where contributors get actual shares in businesses—began with portals like MicroVentures that largely served accredited investors—people with at least $1 million in net worth excluding the home, or incomes over $200,000. (MicroVentures now serves both accredited and nonaccredited investors.)

The 2015 Crowdfunding Industry Report by Crowdsourcing LLC’s Massolution.com, the latest industrywide data available, shows $16.2 billion raised through the various types of crowdfunding in 2014, up 167% from the year before. At the end of 2014 there were more than 1,250 crowdfunding portals world-wide, versus 850 in 2012.

“The floodgates have been opened!” the Massolution report says, and industry experts think growth has continued at a fast clip since that report was written. Many predict more money will be raised in coming years as the number of platforms grows, with new players occupying narrow niches such as fundraising for specific industries and a few big platforms taking an ever-larger share of the market. “International expansion will accelerate,” the report predicts.

For now, the lending, donation and rewards sites dominate crowdfunding. But the equity sector is only likely to grow, as more investors and entrepreneurs learn about it, says John Rampton, an experienced startup investor in Palo Alto, Calif., who has invested in a startups through DreamFunded.

“In the future, a lot more startups will have a chance of being successful because of the funding they can get without [the help of] the institutional investor,” says Mr. Rampton,

The Massolution report found that in 2014, before Title III flung open the doors, the average equity campaign in North America aimed to raise $175,000. Portals charge investors a percentage of the funds raised—for example, 5% for DreamFunded, which welcomes investments as small as $10.

Currently, DreamFunded offers investments in startups like Aqua Blaster, a firm with a new hose nozzle for firefighting and pressure washing, and WorkCar, an Uber-like outfit planning to provide work vehicles. The portal supplies bios on startups’ management teams, a quick financial analysis and the firm’s business plan.

Though he thinks the industry will grow and provide valuable service to startups and small firms ignored by the venture-capital industry, he agrees the investor is more likely to lose money than to get rich.

“I think this is ideal for the person that knows the person that’s raising the money,” such as the owner of a local business, he says.

“I do not see it as a person thinking, ‘Hmm, I have a choice of putting my money in a CD or funding equity startups.’ If you want a safe, secure bet, this is not the way to go.”

Because the industry is so new and startup investments often don’t pay off for a decade or more, it’s too early to tell how well investors can do. Generally, the portals highlight their fundraising record, not investor returns.

But experts say it’s not to soon to see the risks. Marc Seward, principal of Enviso Capital, an investment-advisory firm in San Diego, says he wouldn’t put more than 15% of a client’s portfolio into alternative investments, with startups making up only a fraction of that, regardless of whether the investor uses equity crowdfunding or a more traditional way in.

Mr. Seward says he worries that portals’ seal of approval makes a startup look less dangerous than it is.

Though all these sites promote their due diligence, it’s not what you’d get with a listed stock that has met the listing standards of an exchange.

“I see this lack of due diligence as a tremendous weak link in the new crowdfunding equity space,” says Thomas White, co-director of the entrepreneur incubator at American University’s Kogod School of Business.

“I think a major red flag is that the company is looking to crowdfund for equity in the first place,” says John Torrens, professor of entrepreneurial practice at Syracuse University’s Martin J. Whitman School of Management, noting that “this would signal to me that more-sophisticated angels have looked at it and passed for some reason.”

Skeptics and insiders urge investors to study up before taking the plunge. Specifically:

• Read everything you can, especially on the management, and don’t just rely on the portal.

• See how managers are compensated. It’s a problem if they can boost their pay out of the money raised by the crowdfunding campaign, Mr. Seward says, noting that the better deals divide the first profits among investors before the managers get anything.

• Know whether your shares will have voting rights. While private placements through friends and family or brokerages often do include voting rights, crowdfunding deals generally do not, and in fact portals use this as a selling point to startups. Investors are wise to find out if they’ll have any voice or recourse if they’re dissatisfied with management.

Because of the risks, experts warn against dreams of riches. Be prepared to tie your money up for five to 10 years, and don’t bet the children’s college funds, Mr. Rampton advises, adding, “Nine out of 10 companies fail in the first five years.”

Corrections & Amplifications

Four online crowdfunding portals—EquityNet, Fundable, AngelList and Crowdfunder—are open to well-to-do “accredited investors.” An earlier version of this article incorrectly implied that they allow nonaccredited investors. Also, Kickstarter was described as a charity portal. It is a rewards portal. In addition, MicroVentures now serves both accredited and nonaccredited investors. The article implied it was still limited to accredited investors. (Dec. 9, 2016)

WASHINGTON—Senate Democrats led an uprising against a short-term spending bill Friday, demanding more certainty for coal miners slated to lose their health-care benefits this month and pushing Congress up against the midnight expiration of the government’s current funding.

Democrats still smarting from the defection of the white-working class in last month’s election sought to align themselves with blue-collar workers and drive a wedge between GOP leaders and President-elect Donald Trump’s appeals to the industrial belt.

Spearheaded by Sen. Joe Manchin of West Virginia, centrist Democrats on Friday looked likely to come up short in their effort to rustle up enough opposition to block the short-term spending bill that would keep the government running through April 28 after the expiration of current funding at 12:01 a.m. Eastern Standard Time on Saturday.

They are pushing to find a fix that is longer than the bill’s four-month extension of coal miners’ health-care benefits, which are slated to run out for more than 16,000 miners at month’s end.

“That is not only a nonstarter, that is inhumane,” said Mr. Manchin, who is under consideration by Mr. Trump’s transition officials as a possible secretary of state or energy secretary. Mr. Manchin, who is up for re-election in 2018, was scheduled to meet with Mr. Trump on Monday.

Pointing to the overwhelming House vote, Senate Majority Leader Mitch McConnell (R., Ky.) said on the Senate floor Friday that it was too late to make changes to the bill. But he said he was confident Congress wouldn’t let the miners’ health-care benefits expire in the spring, when the extension ends.

“It is my intention that miners’ health benefits not expire in April. I’m going to work with my colleagues to prevent that,” Mr. McConnell said. “This is a good time [for Democrats] to take yes for an answer,” he said.

White House spokesman Eric Schultz expressed support for the stand that Mr. Manchin and others were taking on the issue of coal-miner pensions.

“These are coal miners who work for decades in treacherous conditions and who earn these benefits. Unfortunately, the proposal that Republicans are floating only takes care for them for a few months. We believe that’s not right,” Mr. Schultz said Friday.

Lacking enough opposition to derail the bill, Mr. Manchin and his supporters can still control whether the government experiences a brief shutdown by deciding whether to allow the chamber to speed up some of its debate, which requires the consent of all 100 senators. If Mr. Manchin holds out, the Senate wouldn’t be able to hold a procedural vote until early Saturday morning, but would still be able to pass the legislation by Sunday.

A brief partial government shutdown is likely to have a minimal impact if funding can be approved by Monday.

The White House has said that the Office of Management and Budget had been in touch with agencies across the government to plan for contingencies, in case funding for the government lapses after Friday evening.

If lawmakers do derail the spending bill, they would force GOP leaders to reopen negotiations and potentially bring the House, which is in recess, back to Washington next week.

The root of this week’s fight goes back decades. The United Mine Workers of America won promises from the federal government for lifetime pension and retiree health benefits for its members, starting in 1946 under President Harry Truman.

Over the years, the funding of miners’ pension and retiree health benefits has become problematic as coal companies have declared bankruptcy, leaving fewer companies to contribute to multiemployer plans, and retirees began to outnumber active miners amid greater automation.

Congress passed measures in the 1990s and 2000s to shore up the benefits, including allowing the interest from the Abandoned Mine Lands fund to be used to cover retiree health costs. The fund, originally created to pay for the cleanup of abandoned mine sites, is fed by taxes on coal companies.

In 2006, Congress allowed the use of general U.S. Treasury funds to cover any deficit in the UMWA retiree health plan for the first time, as well as to pay out money to states and tribes that had already cleaned up their abandoned mines.

Today, the union says about 16,300 retired miners and widows could lose their health coverage on Jan. 1 if Congress doesn’t appropriate funding.

There is currently about $39 million in funding for retiree health care, and roughly $100 million is paid out annually, according to Phil Smith, a UMWA spokesman.

Cecil Roberts, president of the UMWA, has called the proposal to provide four months of funding “a slap in the face” to coal miners.

“America’s miners put their lives on the line to provide the fuel that built our nation,” Mr. Roberts said. “Is their reward to become a perpetual political football, doomed to beg every four months for the benefits they earned and our nation promised them?”

At the same time, the union and members of Congress from coal states are seeking additional funding to keep the UMWA 1974 Pension Plan from becoming insolvent. The plan currently covers 89,000 retirees and widows and has been in critical status for the past two years.

The union says retirees in the pension plan live in all 50 states, though a majority reside in West Virginia, Pennsylvania, Kentucky, Illinois and other major coal-producing states. The average pension benefit is $586 a month for a retired miner or a surviving spouse, according to the union.

Trump vs. Obama: How Harsh Rhetoric Softened After Election Day

Obama: Trump ‘Doesn’t Have the Knowledge’Mr. Obama at an Oct. 14 rally for Hillary Clinton in Cleveland
“When I was running against John McCain, when I was running against Mitt Romney, we had serious disagreements…But I could have seen either one of them serving honorably… But that’s not the case with today’s Republican nominee. He doesn’t have the temperament, he doesn’t have the knowledge, he doesn’t seem to have the interest in acquiring the knowledge or the basic honesty that a president needs to have. And that was true before we heard him talking about how he treats women.”

* * *

Obama: Trump Is ‘Temperamentally Unfit’Mr. Obama at a Nov. 7, 2016, Clinton rally in Durham, N.H.
Donald Trump is temperamentally unfit to be Commander-in-Chief. This is not just my opinion. This is the opinion of a lot of Republicans. Think about it — over the weekend, his campaign took his Twitter account away from him. If your closest advisers don’t trust you to tweet, how can you trust him with the nuclear codes? You can’t do it.

Obama: “Well, I just had the opportunity to have an excellent conversation with President-elect Trump. It was wide-ranging. We talked about some of the organizational issues in setting up the White House. We talked about foreign policy. We talked about domestic policy. And as I said last night, my number-one priority in the coming two months is to try to facilitate a transition that ensures our President-elect is successful. … Most of all, I want to emphasize to you, Mr. President-elect, that we now are going to want to do everything we can to help you succeed — because if you succeed, then the country succeeds.”

Trump: “This was a meeting that was going to last for maybe 10 or 15 minutes, and we were just going to get to know each other. We had never met each other. I have great respect. The meeting lasted for almost an hour and a half. And it could have — as far as I’m concerned, it could have gone on for a lot longer. We really — we discussed a lot of different situations, some wonderful and some difficulties. I very much look forward to dealing with the president in the future, including counsel. He explained some of the difficulties, some of the high-flying assets and some of the really great things that have been achieved.”

* * *

Obama on Trump: ‘I Think He’s Sincere in Wanting to be a Successful President’Obama press conference, Nov. 15
And my advice, as I said to the president-elect when we had our discussions, was that campaigning is different from governing. I think he recognizes that. I think he’s sincere in wanting to be a successful president and moving this country forward and I don’t think any president ever comes in saying to himself “I want to figure out how to make people angry or alienate half the country.” And some of his gifts that obviously allowed him to execute one of the biggest political upsets in history, those are ones that hopefully he will put to good use on behalf of all the American people…. And you know, what’s clear is that he was able to tap into, yes, the anxieties but also the enthusiasm of his voters in a way that was impressive. And I said so to him because I think that to the extent that there were a lot of folks who missed the Trump phenomenon, I think that connection that he was able to make with his supporters, that was impervious to events that might have sunk another candidate. That’s powerful stuff. I also think that he is coming to this office with fewer set hard-and-fast policy prescriptions than a lot of other presidents might be arriving with. I don’t think he is ideological. I think ultimately is, he is pragmatic in that way. And that can serve him well as long as he has got good people around him and he has a clear sense of direction.

* * *

Obama: ‘Cautiously Optimistic About My Successor’Obama press conference with German Chancellor Angela Merkel, Nov. 17
And I don’t expect that the president-elect will follow exactly our blueprint or our approach… .What makes me cautiously optimistic about my successor and the shift from campaign mode to governance is there is something about the solemn responsibilities of that office, the extraordinary demands that are placed on the United States not just by its own people, but by people around the world, that forces you to focus; that demands seriousness…. And you figure that our pretty fast when you’re sitting there. And I think the president-elect is going to see fairly quickly that the demands and responsibilities of a U.S. president are not ones that you can treat casually. And that in a big, complex, diverse country, the only way that you can be successful is by listening and reaching out and working with a wide variety of people. And so, it is my hope that that is what will happen and I’m going to do everything I can over the next two months to help assure that that happens…. [Trump] ran an extraordinarily unconventional campaign and it resulted in the biggest political upset in perhaps modern political history. American history. And that means he now has to transition to governance. What I said to him was that what may work in generating enthusiasm or passion during elections may be different than what will work in terms of unifying the country and gaining the trust even of those who didn’t support him…. And he’s indicated his willingness to — his understanding of that.

* * *

Trump on Obama: ‘I Really Liked Him, I Think He Liked Me’Mr. Trump in Time Magazine interview published Dec. 7, tied to his selection as the magazine’s Person of the Year“He really cares about the country, I have to say. I mean I differ with him in numerous things. But he really cares about the country. I had a great conversation with him. I had a great meeting with him at the White House and a couple of great conversations. He – you know he’s very committed. And you hear all different – I will tell you, I really liked him, I think he liked me. I think he was surprised also. There was good chemistry. But that being said, we differ on things, so that can happen. We talked about some of the potential appointments that I would make. I wanted to get his opinion. And he gave me some opinions on some people that were very interesting to me, and that meant something to me. I believe in asking people. We have different views but he loves our country. And he wants what’s good for our country. So I did talk to him about certain people that I’m thinking about. Got his ideas.

Trump vs. Obama: How Harsh Rhetoric Softened After Election Day

Obama: Trump ‘Doesn’t Have the Knowledge’Mr. Obama at an Oct. 14 rally for Hillary Clinton in Cleveland
“When I was running against John McCain, when I was running against Mitt Romney, we had serious disagreements…But I could have seen either one of them serving honorably… But that’s not the case with today’s Republican nominee. He doesn’t have the temperament, he doesn’t have the knowledge, he doesn’t seem to have the interest in acquiring the knowledge or the basic honesty that a president needs to have. And that was true before we heard him talking about how he treats women.”

* * *

Obama: Trump Is ‘Temperamentally Unfit’Mr. Obama at a Nov. 7, 2016, Clinton rally in Durham, N.H.
Donald Trump is temperamentally unfit to be Commander-in-Chief. This is not just my opinion. This is the opinion of a lot of Republicans. Think about it — over the weekend, his campaign took his Twitter account away from him. If your closest advisers don’t trust you to tweet, how can you trust him with the nuclear codes? You can’t do it.

Obama: “Well, I just had the opportunity to have an excellent conversation with President-elect Trump. It was wide-ranging. We talked about some of the organizational issues in setting up the White House. We talked about foreign policy. We talked about domestic policy. And as I said last night, my number-one priority in the coming two months is to try to facilitate a transition that ensures our President-elect is successful. … Most of all, I want to emphasize to you, Mr. President-elect, that we now are going to want to do everything we can to help you succeed — because if you succeed, then the country succeeds.”

Trump: “This was a meeting that was going to last for maybe 10 or 15 minutes, and we were just going to get to know each other. We had never met each other. I have great respect. The meeting lasted for almost an hour and a half. And it could have — as far as I’m concerned, it could have gone on for a lot longer. We really — we discussed a lot of different situations, some wonderful and some difficulties. I very much look forward to dealing with the president in the future, including counsel. He explained some of the difficulties, some of the high-flying assets and some of the really great things that have been achieved.”

* * *

Obama on Trump: ‘I Think He’s Sincere in Wanting to be a Successful President’Obama press conference, Nov. 15
And my advice, as I said to the president-elect when we had our discussions, was that campaigning is different from governing. I think he recognizes that. I think he’s sincere in wanting to be a successful president and moving this country forward and I don’t think any president ever comes in saying to himself “I want to figure out how to make people angry or alienate half the country.” And some of his gifts that obviously allowed him to execute one of the biggest political upsets in history, those are ones that hopefully he will put to good use on behalf of all the American people…. And you know, what’s clear is that he was able to tap into, yes, the anxieties but also the enthusiasm of his voters in a way that was impressive. And I said so to him because I think that to the extent that there were a lot of folks who missed the Trump phenomenon, I think that connection that he was able to make with his supporters, that was impervious to events that might have sunk another candidate. That’s powerful stuff. I also think that he is coming to this office with fewer set hard-and-fast policy prescriptions than a lot of other presidents might be arriving with. I don’t think he is ideological. I think ultimately is, he is pragmatic in that way. And that can serve him well as long as he has got good people around him and he has a clear sense of direction.

* * *

Obama: ‘Cautiously Optimistic About My Successor’Obama press conference with German Chancellor Angela Merkel, Nov. 17
And I don’t expect that the president-elect will follow exactly our blueprint or our approach… .What makes me cautiously optimistic about my successor and the shift from campaign mode to governance is there is something about the solemn responsibilities of that office, the extraordinary demands that are placed on the United States not just by its own people, but by people around the world, that forces you to focus; that demands seriousness…. And you figure that our pretty fast when you’re sitting there. And I think the president-elect is going to see fairly quickly that the demands and responsibilities of a U.S. president are not ones that you can treat casually. And that in a big, complex, diverse country, the only way that you can be successful is by listening and reaching out and working with a wide variety of people. And so, it is my hope that that is what will happen and I’m going to do everything I can over the next two months to help assure that that happens…. [Trump] ran an extraordinarily unconventional campaign and it resulted in the biggest political upset in perhaps modern political history. American history. And that means he now has to transition to governance. What I said to him was that what may work in generating enthusiasm or passion during elections may be different than what will work in terms of unifying the country and gaining the trust even of those who didn’t support him…. And he’s indicated his willingness to — his understanding of that.

* * *

Trump on Obama: ‘I Really Liked Him, I Think He Liked Me’Mr. Trump in Time Magazine interview published Dec. 7, tied to his selection as the magazine’s Person of the Year“He really cares about the country, I have to say. I mean I differ with him in numerous things. But he really cares about the country. I had a great conversation with him. I had a great meeting with him at the White House and a couple of great conversations. He – you know he’s very committed. And you hear all different – I will tell you, I really liked him, I think he liked me. I think he was surprised also. There was good chemistry. But that being said, we differ on things, so that can happen. We talked about some of the potential appointments that I would make. I wanted to get his opinion. And he gave me some opinions on some people that were very interesting to me, and that meant something to me. I believe in asking people. We have different views but he loves our country. And he wants what’s good for our country. So I did talk to him about certain people that I’m thinking about. Got his ideas.

Pentagon Prepares Tougher Options on Fighting Militants to Show Trump Team

By Gordon Lubold, Julian E. Barnes

WASHINGTON—The Pentagon is drawing up proposals to offer to the Trump administration designed to intensify the U.S. campaign against Islamic State, including reducing White House oversight of operational decisions and moving some tactical authority back to the Pentagon, U.S. military and congressional officials say.

The options are being assembled in anticipation of demands by Donald Trump and his team, who have called for a tougher military campaign against the extremist group.

Military officials said they are considering presenting options on a number of fronts. They are likely to include easing restrictions on the precise number of American troops needed to carry out a particular mission, and relaxing rules that set the level of Washington review needed before an operation or airstrike may be conducted, officials said.

The potential recommendations aren’t likely to fundamentally change the U.S. strategy for fighting Islamic State, which relies on indigenous forces and relatively few American advisers. But they open prospects for the new administration to return more battlefield decision-making to the military, officials said.

Military officials familiar with the internal discussions at the Pentagon said officers aren’t taking advocacy positions on issues, but are prepared to answer the questions the new administration will have and make proposals as requested.

“Once the new administration is in place, we will offer recommendations going forward, should the new administration wish to amend those assumptions or the current approach,” a military official said.

Military officials stressed they only have one commander in chief, President Barack Obama. But they also say they must be prepared for an incoming administration that has already publicly signaled an interest in intensifying the fight against Islamic State.

The Pentagon’s preparations for the Trump transition are like those for any new administration. When Mr. Obama took office in 2009 with plans to wind down the U.S. involvement in Iraq and Afghanistan, the Pentagon prepared options acceptable to the military that also would address the new president’s goals, officials said.

Retired Lt. Gen. Michael Flynn, tapped to serve as Mr. Trump’s national security adviser, has said the new administration will do a full reassessment of the authorities at the military’s disposal to execute the fight against Islamic State. The military’s proposals will feed into Mr. Flynn’s review, an official close to the Trump transition team said.

One result of the increased latitude, officials acknowledged, is the potential for deploying more U.S. forces. The Obama White House’s approach has been to use local forces and carefully limit the exposure of American personnel to combat.

But that stance has also drawn criticism from Republicans and some in the military that the White House is overly cautious and deliberative when requests to conduct operations are put before them.

“Part of the problem is, is that inside of the military right now…their hands are tied,” Gen. Flynn said in a recent FOX News interview.

White House officials said they approve all requests for operations and authorities they receive. For example, about 18 months ago, the White House loosened a restriction requiring that an airstrike cause no collateral civilian casualties. In that instance, the change expanded to 10 the number of civilians who could be potentially killed by accident if the value of the target was deemed high enough, military officials said.

“As Secretary [Ash] Carter has said repeatedly, every time he and General Dunford have asked the president for more capability in the fight against ISIL, he has agreed to that request,” said deputy Pentagon press secretary Gordon Trowbridge.

Currently, so-called business rules tightly govern how many forces the Pentagon can have in play. There are about 5,000 U.S. troops in Iraq and up to 300 special-operations forces personnel in Syria. In Afghanistan, U.S. troop strength is due to drop this month from about 9,800 to 8,400 under Obama administration directions.

In the past, the White House has retained strict oversight over the number of forces used in various missions. Some requests for more troops have required weeks or even months to win approval, officials say.

In one instance in the past year, military officials proposed a high-risk operation in Syria relying on about two dozen commandos. By the time the operation was ready to go and was about to be approved, the number of troops needed for the mission had grown to about 30 individuals. That change prompted White House officials to demand to know why it had expanded, senior military officials said.

U.S. officials defended the White House oversight in that instance, because of the extreme perils to U.S. forces associated with the operation.

Other options under consideration for the new administration would give the military more leeway to go after militants, military officials said. For example, the U.S. military has been conducting an effective campaign against Islamic State within the coastal city of Sirte, in northern Libya, under current authorities allowing it to take necessary measures in the city.

But if U.S. forces need to target a militant or group of fighters as little as 3 miles outside of the city—beyond what is known as the “area of active hostilities”—doing so currently requires White House approval, a senior military official said.

Such approval can potentially blunt the military’s effectiveness by slowing down the approval process, officials said. For example, it took eight months before the White House approved the airstrike that targeted an al Qaeda leader with links to Islamic State in Libya named Abu Nabil, or Wissam Najm
Abd Zayd al Zubayadi, in November 2015.

But the Obama White House has granted expanded military authorities over the past year to fight Islamic State in Afghanistan and to allow the U.S. to target the Taliban under certain circumstances.

Pentagon Prepares Tougher Options on Fighting Militants to Show Trump Team

By Gordon Lubold, Julian E. Barnes

WASHINGTON—The Pentagon is drawing up proposals to offer to the Trump administration designed to intensify the U.S. campaign against Islamic State, including reducing White House oversight of operational decisions and moving some tactical authority back to the Pentagon, U.S. military and congressional officials say.

The options are being assembled in anticipation of demands by Donald Trump and his team, who have called for a tougher military campaign against the extremist group.

Military officials said they are considering presenting options on a number of fronts. They are likely to include easing restrictions on the precise number of American troops needed to carry out a particular mission, and relaxing rules that set the level of Washington review needed before an operation or airstrike may be conducted, officials said.

The potential recommendations aren’t likely to fundamentally change the U.S. strategy for fighting Islamic State, which relies on indigenous forces and relatively few American advisers. But they open prospects for the new administration to return more battlefield decision-making to the military, officials said.

Military officials familiar with the internal discussions at the Pentagon said officers aren’t taking advocacy positions on issues, but are prepared to answer the questions the new administration will have and make proposals as requested.

“Once the new administration is in place, we will offer recommendations going forward, should the new administration wish to amend those assumptions or the current approach,” a military official said.

Military officials stressed they only have one commander in chief, President Barack Obama. But they also say they must be prepared for an incoming administration that has already publicly signaled an interest in intensifying the fight against Islamic State.

The Pentagon’s preparations for the Trump transition are like those for any new administration. When Mr. Obama took office in 2009 with plans to wind down the U.S. involvement in Iraq and Afghanistan, the Pentagon prepared options acceptable to the military that also would address the new president’s goals, officials said.

Retired Lt. Gen. Michael Flynn, tapped to serve as Mr. Trump’s national security adviser, has said the new administration will do a full reassessment of the authorities at the military’s disposal to execute the fight against Islamic State. The military’s proposals will feed into Mr. Flynn’s review, an official close to the Trump transition team said.

One result of the increased latitude, officials acknowledged, is the potential for deploying more U.S. forces. The Obama White House’s approach has been to use local forces and carefully limit the exposure of American personnel to combat.

But that stance has also drawn criticism from Republicans and some in the military that the White House is overly cautious and deliberative when requests to conduct operations are put before them.

“Part of the problem is, is that inside of the military right now…their hands are tied,” Gen. Flynn said in a recent FOX News interview.

White House officials said they approve all requests for operations and authorities they receive. For example, about 18 months ago, the White House loosened a restriction requiring that an airstrike cause no collateral civilian casualties. In that instance, the change expanded to 10 the number of civilians who could be potentially killed by accident if the value of the target was deemed high enough, military officials said.

“As Secretary [Ash] Carter has said repeatedly, every time he and General Dunford have asked the president for more capability in the fight against ISIL, he has agreed to that request,” said deputy Pentagon press secretary Gordon Trowbridge.

Currently, so-called business rules tightly govern how many forces the Pentagon can have in play. There are about 5,000 U.S. troops in Iraq and up to 300 special-operations forces personnel in Syria. In Afghanistan, U.S. troop strength is due to drop this month from about 9,800 to 8,400 under Obama administration directions.

In the past, the White House has retained strict oversight over the number of forces used in various missions. Some requests for more troops have required weeks or even months to win approval, officials say.

In one instance in the past year, military officials proposed a high-risk operation in Syria relying on about two dozen commandos. By the time the operation was ready to go and was about to be approved, the number of troops needed for the mission had grown to about 30 individuals. That change prompted White House officials to demand to know why it had expanded, senior military officials said.

U.S. officials defended the White House oversight in that instance, because of the extreme perils to U.S. forces associated with the operation.

Other options under consideration for the new administration would give the military more leeway to go after militants, military officials said. For example, the U.S. military has been conducting an effective campaign against Islamic State within the coastal city of Sirte, in northern Libya, under current authorities allowing it to take necessary measures in the city.

But if U.S. forces need to target a militant or group of fighters as little as 3 miles outside of the city—beyond what is known as the “area of active hostilities”—doing so currently requires White House approval, a senior military official said.

Such approval can potentially blunt the military’s effectiveness by slowing down the approval process, officials said. For example, it took eight months before the White House approved the airstrike that targeted an al Qaeda leader with links to Islamic State in Libya named Abu Nabil, or Wissam Najm
Abd Zayd al Zubayadi, in November 2015.

But the Obama White House has granted expanded military authorities over the past year to fight Islamic State in Afghanistan and to allow the U.S. to target the Taliban under certain circumstances.

South Korea Impeachment of President Park Is Latest Hit to Global Political Order

By Alastair Gale, Jonathan Cheng

SEOUL—The impeachment of South Korea’s president heralds the prospect of a new government for one of the U.S.’s closest allies with a more skeptical stance toward Washington, free trade and big business.

A resounding decisionby South Korea’s National Assembly to impeach President Park Geun-hye, by a 234-56 vote, is a fresh earthquake to hit the global political order following populist referendum victories in the U.K. and Italy, and Donald Trump’s election as U.S. president.

Ms. Park’s immediate removal from poweron Friday marks a turning point after South Korea’s biggest political crisisin years brought millions of demonstrators onto the streets in protest against her. Demonstrators massed outside the National Assembly building as the vote took place on Friday and celebrated its passage.

Ms. Park has been accused by prosecutors of leaking confidential presidential documents and helping a close friend shake down corporations for money. She has denied wrongdoing in three televised statements.

In a meeting with cabinet officials following the vote, Ms. Park said, “I am truly sorry to my fellow Koreans that my carelessness and shortcomings have led to such grave national turmoil.”

The Constitutional Court will rule on the validity of the impeachment motion in as soon as a few weeks. If it upholds the vote, as many analysts expect, a presidential election would take place two months later. Ms. Park would be barred from running and would also lose her immunity from criminal prosecution.

If her impeachment is overturned, Ms. Park would be reinstated and could serve out the remainder of her term through February 2018. Ms. Park said she would await the court’s ruling with a “calm attitude.”

While the court deliberates, South Korea’s acting head of state will be Prime Minister Hwang Kyo-ahn, a low-profile career bureaucrat who is unlikely to make any significant policy changes.

The U.S. moved quickly Friday to say it would work with Mr. Hwang. “We expect policy consistency and continuity across a range of fronts, including DPRK, other regional issues, and international economics and trade,” said State Department spokeswoman Anna Richey-Allen, using an acronym for North Korea.

The U.S.’s alliance with South Korea “will continue to be a linchpin of regional stability and security, and we will continue to meet all our alliance commitments, especially with respect to defending against the threat from North Korea,” she added.

The vote has opened a new period of uncertainty for Asia’s fourth largest economy and complicates diplomacy in a volatile region for President-elect Trump, who has questioned Washington’s defense alliance with South Korea during his campaign.

U.S. and South Korean diplomats say ties between the two nations under the conservative administrations of Ms. Park and her predecessor, Lee Myung-bak, have been as close as at any point since American forces fought to protect the democratic South from the communist North in the Korean War of the 1950s.

Washington and Seoul enacted a bilateral free-trade agreement in 2012, a year before Ms. Park became president. Under a defense treaty, the U.S. bases around 28,500 troops in South Korea to ward off North Korean attack and holds major military drills with South Korea twice a year, as well as providing the threat of use of American nuclear weapons. South Korea has also grown closer to U.S. ally Japan, resolving some long-festering diplomatic tensions and recently signing an agreement to share military intelligence.

However, those trade, diplomatic and defense ties, including a plan to base an advanced U.S. missile defense system in South Korea next year to protect against any North Korean attack, regularly face criticism from South Korea’s left-of-center opposition parties, which lean more toward trying to improve ties with Pyongyang and Beijing.

Strong resistance to the missile defense plan from China, which opposes U.S. military hardware so close to its border, has increased unease about the planned deployment among opposition leaders.

Earlier this year, the opposition parties gained a majority in the National Assembly and joined forces to press for Ms. Park’s removal in hopes of winning back the presidency for the first time since 2008.

Recent opinion polls show most of the leading challengers in a hypothetical presidential election hail from the political left. Ms. Park’s own party has been hammered in the polls by the scandal, prompting more than 50 members of her party to support the impeachment motion.

One of the leading presidential candidates in recent surveys is a senior figure in the largest opposition Democratic Party who is among the strongest supporters of dialogue with North Korea. Moon Jae-in, who narrowly lost to Ms. Park in the 2012 presidential election, is the former chief of staff to a previous president who pursued a “sunshine policy” of seeking to tame North Korea’s aggression through talks and economic integration.

Following North Korea’s nuclear test in January, Washington and Seoul stepped up efforts to pressure Pyongyang with sanctions. Further tightening of sanctions followed another nuclear test in September, as well as dozens of missile tests this year.

It isn’t clear if Mr. Trump would continue the sanctions push on North Korea. He said during election campaigning he would be willing to meet North Korean leader Kim Jong Un. In a phone call shortly after his election victory, Mr. Trump told Ms. Park that he would preserve the security alliance with South Korea, according to her office.

Trade tension with the U.S. could potentially flare if Ms. Park is replaced by a left-leaning president. Huge public demonstrations against Ms. Park have been swollen by farmers and labor unions seeking more protectionist trade policies and government subsidies for products such as rice.

South Korea’s Democratic Party strongly opposed the free-trade deal with the U.S., which lowered high tariffs on American imports. Mr. Trump has in turn criticized the agreement as unfair for U.S. businesses.

“A change of power in South Korea and Mr. Trump’s election could create instability in bilateral ties for some time,” said Park Cheol-hee, dean of the Graduate School of International Studies at Seoul National University and no relation to Ms. Park.

Ms. Park’s downfall could also increase risks for the sprawling South Korean conglomerates known as chaebol. Several of the presidential contenders with the biggest bases of public support have called for tighter regulations on the business groups.

The mayor of a Seoul suburb who has rapidly gained support for a presidential bid has said he would seek to dismantle the chaebols altogether. The companies were sucked into the scandal by lawmakers’ allegations they gained favorable government treatment by contributing to foundations set up by Ms. Park’s friend.

Public anger against Ms. Park has also had some of the flavor of populist uprisings in the U.S. and Europe against long-entrenched political and economic interests. Ms. Park is the daughter of a former president who built South Korea’s economy around the chaebols, huge family-run conglomerates that still dominate business but hire fewer and fewer locals.

The only potential conservative candidate for president who has some public support is Ban Ki-moon, the United Nations Secretary-General who completes his term this year but hasn’t said whether he’s interested in the presidency. His poll numbers have fallen in recent weeks because of his links to Ms. Park.

The drama is the latest political upheaval to roil South Korea, a strategically important country with a history of crisis, since its founding in 1948. All 10 of South Korea’s presidents before Ms. Park were either forced out of office, assassinated or otherwise embroiled in scandal.

The country only emerged from dictatorial rule in the late 1980s, after a democratization movement marked by sprawling street protests forced open elections. The Constitutional Court that will determine Ms. Park’s fate wasn’t established until 1988, and overturned the legislature’s impeachment vote against then-president Roh Moo-hyun in 2004.

During the two months that the Constitutional Court deliberated on Mr. Roh’s fate, the acting president at that time ran a relatively low-key caretaker government, with little use of executive power.

Experts say the court may rule more quickly in support of the impeachment of Ms. Park, in part because of overwhelming public support for the move and the backing of many members of Ms. Park’s own party. It must make a decision no later than within six months.

In a response to Georgia sent Thursday night, the department said it had tracked the IP address to part of the U.S. Customs and Border Protection computer network—a part of Homeland Security that isn’t typically involved in cybersecurity efforts.

Georgia Secretary of State Brian Kemp this week said the state had discovered an unsuccessful attempt to breach the firewall of computer systems that house sensitive data, such as voter registration and corporate information. The attempt occurred on Nov. 15, Mr. Kemp wrote in a letter.

Mr. Kemp’s letter generated a response the same day from Philip McNamara, a top official at the department who serves as assistant secretary for intergovernmental affairs.

“DHS has not intentionally scanned the systems of the Georgia Secretary of State office. DHS has not tried to break into those systems,” Mr. McNamara wrote in an email. He added the federal government had tracked the IP address to Customs and Border Protection.

“When DHS does scans of a customer, we do not do them through the CBP Internet Gateway. CBP is an entirely different organization,” Mr. McNamara said. “We are deeply concerned with this situation. We’ve had a team working throughout the day trying to determine what has happened.”

The intrusion was detected by a third-party cybersecurity service working with the state. It was reportedly unsuccessful.

Homeland Security also briefed members of the Georgia congressional delegation about the alleged intrusion this week, according to a person familiar with the conversation. Members of Congress were told the department was exploring the possibility it was an inadvertent scan of the state’s systems, a malicious actor within the federal government acting independently or a foreign attacker using U.S. government systems.

A spokeswoman for the department didn’t immediately respond to a request for comment.

In a response to Georgia sent Thursday night, the department said it had tracked the IP address to part of the U.S. Customs and Border Protection computer network—a part of Homeland Security that isn’t typically involved in cybersecurity efforts.

Georgia Secretary of State Brian Kemp this week said the state had discovered an unsuccessful attempt to breach the firewall of computer systems that house sensitive data, such as voter registration and corporate information. The attempt occurred on Nov. 15, Mr. Kemp wrote in a letter.

Mr. Kemp’s letter generated a response the same day from Philip McNamara, a top official at the department who serves as assistant secretary for intergovernmental affairs.

“DHS has not intentionally scanned the systems of the Georgia Secretary of State office. DHS has not tried to break into those systems,” Mr. McNamara wrote in an email. He added the federal government had tracked the IP address to Customs and Border Protection.

“When DHS does scans of a customer, we do not do them through the CBP Internet Gateway. CBP is an entirely different organization,” Mr. McNamara said. “We are deeply concerned with this situation. We’ve had a team working throughout the day trying to determine what has happened.”

The intrusion was detected by a third-party cybersecurity service working with the state. It was reportedly unsuccessful.

Homeland Security also briefed members of the Georgia congressional delegation about the alleged intrusion this week, according to a person familiar with the conversation. Members of Congress were told the department was exploring the possibility it was an inadvertent scan of the state’s systems, a malicious actor within the federal government acting independently or a foreign attacker using U.S. government systems.

A spokeswoman for the department didn’t immediately respond to a request for comment.

21st Century Fox In Talks to Buy Rest of U.K.’s Sky

By Shalini Ramachandran, Austen Hufford, David Benoit

The Murdoch family’s 21st Century Fox Inc. is making another run at buying the rest of Sky PLC, the U.K.-based pay-TV giant, five years after its previous attempt was thwarted and as change roils the global media industry.

The companies in separate statements Friday said they had reached an agreement in principle for Fox to buy the 60.9% of Sky it doesn’t already own for £10.75 ($13.52) per share in cash, or about $14 billion. The bid, which values all of Sky at about $23 billion, represents a 40% premium to its closing price Tuesday, the last business day before Fox made its approach.

The companies said they still must agree on “certain material offer terms,” without being more specific. Among them is the size of the breakup fee one side would pay the other if the deal falls apart between signing and closing, people familiar with the matter said.

According to U.K. takeover rules, Fox has until Jan. 6 to firm up the offer or walk away. Even if both sides cement the deal, they could face a rigorous regulatory review.

Fox, like Wall Street Journal parent News Corp, counts Rupert Murdoch and his family as major stakeholders. The company Friday trumpeted the strategic benefits of bringing together its collection of global entertainment assets with Sky’s distribution capabilities and premium content, including rights to European sports like the Bundesliga German soccer league.

Fox’s board was motivated to make the move now as a global arms race to merge content and distribution heats up following AT&T Inc.’s proposed merger with Time Warner Inc., people familiar with the matter said. Fox believes a combination will help it tap into the direct-to-consumer streaming capability across Europe of Sky, which operates services such as NOW TV in the U.K. and Sky Ticket in Germany.

The $85 billion AT&T deal also has raised concerns about that potential giant’s ability to enforce tougher economics on rival distributors, including Sky, which purchases content from Time Warner’s HBO. Fox’s board viewed a wholly owned Sky as having a stronger hand in negotiations with AT&T, one of the people said.

The Time Warner deal, combined with the potential for eased regulations on big distributors in the Trump administration, “has everyone reassessing the competitive landscape,” said Tony Wible, an analyst at broker Drexel Hamilton. “Vertical integration may be more important.”

Fox stock fell 2% Friday, while Sky shares, which had dropped nearly 30% since the beginning of the year, shot up 27% on the news.

Fox has struggled to meet its earnings guidance over the past few years, in part due to film and broadcast-TV misses, and discontinued offering financial guidance as the U.S. pay-TV market has been buffeted by forces like cord-cutting. Consolidating Sky’s cash flows would lessen Fox’s reliance on the U.S. and clarify investor uncertainty over the stake, which has dogged Fox’s stock, analysts said.

Fox’s move was also driven in part by the recent slide in the British pound against the U.S. dollar, according to people familiar with the approach. The U.K. currency is down 16% against the dollar since Britons voted in June to exit from the European Union.

In 2011, Fox’s predecessor dropped an earlier bidto take full control of Sky after a scandal over phone hacking at one of its U.K. newspaper titles sparked government resistance to the deal.

Following the scandal, Mr. Murdoch moved to distance the company’s film-and-television businesses from its slower-growing publishing operations by splitting it in two in 2013. 21st Century Fox comprises a studio, TV stations and cable networks. News Corp owns newspapers like the Times of London and the Journal, HarperCollins Publishers, real-estate-related web properties and other assets.

Wall Street analysts say the split could ease the regulatory path for Fox this time. The deal is expected to undergo a review by the European Union’s antitrust authority and may also require U.K. regulatory approval on public-interest grounds.

Fox is expected to note to U.K. regulators that, unlike last time around, it doesn’t own any news outlets in the U.K. except through its existing minority position in Sky, and therefore a combination won’t impact diversity in media ownership.

Tom Watson, a Labour lawmaker who led the drive to investigate the phone hacking, said Friday in a statement that if a deal was reached, “it will be incumbent on the regulatory authorities…to ensure that media plurality is upheld and that competition concerns are addressed.” He added: “The bid must also be judged on its likely impact on the U.K. news market and the provision of robust and independent journalism.”

Recently, the Murdoch family has shown new interest in Sky. In January, Fox Chief Executive James Murdoch was appointed Sky chairman, four years after he had stepped down from the role following the phone-hacking scandal.

James Murdoch has repeatedly told investors that owning a minority stake in Sky wasn’t a “natural end-state.” He also has often lauded Sky’s products like its Sky Go streaming app and its focus on customer experience—an area in which he has said U.S. cable and satellite operators lag. He led the bid with his brother Lachlan, who along with their father is executive co-chairman of Fox, a person familiar with the matter said.

Analysts have long speculated that Fox would try another takeover once the political climate in the U.K. settled and if Sky stock stumbled.

Sky was created in 1990 when Rupert Murdoch’s then-year-old Sky Television merged with British Satellite Broadcasting to create the U.K.’s biggest digital subscription pay-TV provider. Since then, Sky has expanded in Europe, buying its sister companiesin Germany and Italy from Fox and creating a pan-European pay-TV giant with 21.8 million customers across Germany, Italy, Austria, the U.K. and Ireland.

It was known as British Sky Broadcasting, or BSkyB, until 2015, when it changed its name to simply Sky to reflect its growing European footprint.

21st Century Fox In Talks to Buy Rest of U.K.’s Sky

By Shalini Ramachandran, Austen Hufford, David Benoit

The Murdoch family’s 21st Century Fox Inc. is making another run at buying the rest of Sky PLC, the U.K.-based pay-TV giant, five years after its previous attempt was thwarted and as change roils the global media industry.

The companies in separate statements Friday said they had reached an agreement in principle for Fox to buy the 60.9% of Sky it doesn’t already own for £10.75 ($13.52) per share in cash, or about $14 billion. The bid, which values all of Sky at about $23 billion, represents a 40% premium to its closing price Tuesday, the last business day before Fox made its approach.

The companies said they still must agree on “certain material offer terms,” without being more specific. Among them is the size of the breakup fee one side would pay the other if the deal falls apart between signing and closing, people familiar with the matter said.

According to U.K. takeover rules, Fox has until Jan. 6 to firm up the offer or walk away. Even if both sides cement the deal, they could face a rigorous regulatory review.

Fox, like Wall Street Journal parent News Corp, counts Rupert Murdoch and his family as major stakeholders. The company Friday trumpeted the strategic benefits of bringing together its collection of global entertainment assets with Sky’s distribution capabilities and premium content, including rights to European sports like the Bundesliga German soccer league.

Fox’s board was motivated to make the move now as a global arms race to merge content and distribution heats up following AT&T Inc.’s proposed merger with Time Warner Inc., people familiar with the matter said. Fox believes a combination will help it tap into the direct-to-consumer streaming capability across Europe of Sky, which operates services such as NOW TV in the U.K. and Sky Ticket in Germany.

The $85 billion AT&T deal also has raised concerns about that potential giant’s ability to enforce tougher economics on rival distributors, including Sky, which purchases content from Time Warner’s HBO. Fox’s board viewed a wholly owned Sky as having a stronger hand in negotiations with AT&T, one of the people said.

The Time Warner deal, combined with the potential for eased regulations on big distributors in the Trump administration, “has everyone reassessing the competitive landscape,” said Tony Wible, an analyst at broker Drexel Hamilton. “Vertical integration may be more important.”

Fox stock fell 2% Friday, while Sky shares, which had dropped nearly 30% since the beginning of the year, shot up 27% on the news.

Fox has struggled to meet its earnings guidance over the past few years, in part due to film and broadcast-TV misses, and discontinued offering financial guidance as the U.S. pay-TV market has been buffeted by forces like cord-cutting. Consolidating Sky’s cash flows would lessen Fox’s reliance on the U.S. and clarify investor uncertainty over the stake, which has dogged Fox’s stock, analysts said.

Fox’s move was also driven in part by the recent slide in the British pound against the U.S. dollar, according to people familiar with the approach. The U.K. currency is down 16% against the dollar since Britons voted in June to exit from the European Union.

In 2011, Fox’s predecessor dropped an earlier bidto take full control of Sky after a scandal over phone hacking at one of its U.K. newspaper titles sparked government resistance to the deal.

Following the scandal, Mr. Murdoch moved to distance the company’s film-and-television businesses from its slower-growing publishing operations by splitting it in two in 2013. 21st Century Fox comprises a studio, TV stations and cable networks. News Corp owns newspapers like the Times of London and the Journal, HarperCollins Publishers, real-estate-related web properties and other assets.

Wall Street analysts say the split could ease the regulatory path for Fox this time. The deal is expected to undergo a review by the European Union’s antitrust authority and may also require U.K. regulatory approval on public-interest grounds.

Fox is expected to note to U.K. regulators that, unlike last time around, it doesn’t own any news outlets in the U.K. except through its existing minority position in Sky, and therefore a combination won’t impact diversity in media ownership.

Tom Watson, a Labour lawmaker who led the drive to investigate the phone hacking, said Friday in a statement that if a deal was reached, “it will be incumbent on the regulatory authorities…to ensure that media plurality is upheld and that competition concerns are addressed.” He added: “The bid must also be judged on its likely impact on the U.K. news market and the provision of robust and independent journalism.”

Recently, the Murdoch family has shown new interest in Sky. In January, Fox Chief Executive James Murdoch was appointed Sky chairman, four years after he had stepped down from the role following the phone-hacking scandal.

James Murdoch has repeatedly told investors that owning a minority stake in Sky wasn’t a “natural end-state.” He also has often lauded Sky’s products like its Sky Go streaming app and its focus on customer experience—an area in which he has said U.S. cable and satellite operators lag. He led the bid with his brother Lachlan, who along with their father is executive co-chairman of Fox, a person familiar with the matter said.

Analysts have long speculated that Fox would try another takeover once the political climate in the U.K. settled and if Sky stock stumbled.

Sky was created in 1990 when Rupert Murdoch’s then-year-old Sky Television merged with British Satellite Broadcasting to create the U.K.’s biggest digital subscription pay-TV provider. Since then, Sky has expanded in Europe, buying its sister companiesin Germany and Italy from Fox and creating a pan-European pay-TV giant with 21.8 million customers across Germany, Italy, Austria, the U.K. and Ireland.

It was known as British Sky Broadcasting, or BSkyB, until 2015, when it changed its name to simply Sky to reflect its growing European footprint.